According to S&P Global's (NYSE: SPGI) top economist, the dollar's status as the world's reserve currency is eroding. Aggressive U.S. sanctions, such the freezing of Russia's reserves worth hundreds of billions of dollars last year, have caused a flurry of nations to start trading in currencies other than the dollar and returning gold reserves. At …
According to S&P Global’s (NYSE: SPGI) top economist, the dollar’s status as the world’s reserve currency is eroding. Aggressive U.S. sanctions, such the freezing of Russia’s reserves worth hundreds of billions of dollars last year, have caused a flurry of nations to start trading in currencies other than the dollar and returning gold reserves. At a conference held by the ratings company in London, Paul Gruenwald, chief economist at S&P, remarked that the dollar “doesn’t have quite the pull it used to.” “There’s a fragmentation around the edges”. “We’ve got other things happening outside of the dollar world,” said Gruenwald, citing a number of instances in which nations were currently avoiding the currency. He mentioned the increase in trade conducted in the Chinese yuan as well as the affordable financing provided by development banks with headquarters in China, like the New Development Bank and the Asia Infrastructure Investment Bank, formerly known as the BRICs bank. “The U.S. (dollar) will continue to be a leading world currency, but it will no longer be the dominant world currency,” Gruenwald said.
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